What type of incurred cost provides long-term activity capacity,usually as the result of strategic planning?
A)discretionary fixed expenses
B)committed fixed expenses
C)mixed costs
D)step-variable costs

Question

Quizplus · Accepted Answer

Committed fixed expenses provide a long-term activity capacity and are the result of strategic planning. They are obligations that cannot be easily changed or adjusted, such as long-term leases or equipment purchases. Discretionary fixed expenses are not necessarily the result of strategic planning and can be adjusted or cut if necessary. Mixed costs are a combination of fixed and variable costs, and step-variable costs increase in increments as activity levels increase but remain constant within each increment.

What Type of Incurred Cost Provides Long-Term Activity Capacity,usually as the Result